[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4546 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 4546

    To strengthen families receiving aid to families with dependent 
   children through education, job training, savings, and investment 
   opportunities, and to provide States with greater flexibility in 
administering such aid in order to help individuals make the transition 
         from welfare to employment and economic independence.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 8, 1994

  Mr. Flake introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
    To strengthen families receiving aid to families with dependent 
   children through education, job training, savings, and investment 
   opportunities, and to provide States with greater flexibility in 
administering such aid in order to help individuals make the transition 
         from welfare to employment and economic independence.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Family Investment 
and Self-Sufficiency Act of 1994''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. State option to increase AFDC income disregards and disregard 
                            all child support payments.
Sec. 3. Tax credit for contributions by low-income individuals to 
                            qualified asset accounts.
Sec. 4. State option to increase AFDC income disregard for certain 
                            stepparents.
Sec. 5. Elimination of rules that treat families differently based on 
                            number of parents in the home.
Sec. 6. Extension of transitional child care benefits for employed AFDC 
                            recipients.
Sec. 7. Denial of AFDC for applicants who have abandoned a child.
Sec. 8. State option to deny AFDC for additional children.
Sec. 9. State option to deny AFDC benefits to parents whose children 
                            have not received required immunizations.
Sec. 10. State option to disregard income and resources designated for 
                            education, training, employability, or 
                            self-employment.
Sec. 11. State option to increase limitation on disregard of equity in 
                            an automobile.
Sec. 12. Treatment of student earnings under the AFDC program.
Sec. 13. Effective date.

SEC. 2. STATE OPTION TO INCREASE AFDC INCOME DISREGARDS AND DISREGARD 
              ALL CHILD SUPPORT PAYMENTS.

    Section 402(a)(8)(B) of the Social Security Act (42 U.S.C. 
602(a)(8)(B)) is amended--
            (1) by striking ``and'' at the end of clause (i); and
            (2) by adding at the end the following:
                    ``(iii) may disregard--
                            ``(I) earned income of any child or 
                        relative receiving aid to families with 
                        dependent children, or of any other individual 
                        (living in the same home as such relative and 
                        child) whose needs are taken into account in 
                        making the determination under paragraph (7), 
                        in accordance with any combination of rules 
                        that is not less favorable than the rules 
                        contained in clauses (ii) and (iv) of 
                        subparagraph (A) and clause (ii) of this 
                        subparagraph and not more favorable than a 
                        disregard of the first $200 of the total of 
                        such earned income for such month plus \1/2\ of 
                        the remainder thereof; and
                            ``(II) child support payments received by 
                        any such child, relative, or other individual, 
                        in accordance with any combination of rules 
                        that is not less favorable than the rules 
                        contained in subparagraph (A)(vi) and not more 
                        favorable than a disregard of all such child 
                        support payments received.''.

SEC. 3. TAX CREDIT FOR CONTRIBUTIONS BY LOW-INCOME INDIVIDUALS TO 
              QUALIFIED ASSET ACCOUNTS.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to refundable credits) 
is amended by redesignating section 35 as section 36 and by inserting 
after section 34 the following new section:

``SEC. 35. QUALIFIED ASSET ACCOUNT CONTRIBUTIONS.

    ``(a) Allowance of Credit.--
            ``(1) In general.--In the case of an eligible individual, 
        there shall be allowed as a credit against the tax imposed by 
        this subtitle for the taxable year an amount equal to the 
        applicable percentage of the qualified asset account 
        contributions of the individual for the taxable year.
            ``(2) Applicable percentage.--For purposes of paragraph 
        (1), the applicable percentage is--
                    ``(A) 10 percent with respect to so much of the 
                aggregate qualified asset account contributions of the 
                individual for the taxable year as do not exceed 
                $1,000, and
                    ``(B) 20 percent with respect to so much of such 
                contributions as exceed $1,000 but do not exceed 
                $2,000.
    ``(b) Limitation.--
            ``(1) In general.--The amount of qualified asset account 
        contributions by an eligible individual which may be taken into 
        account under subsection (a) for any taxable year shall not 
        exceed the lesser of--
                    ``(A) $2,000, or
                    ``(B) an amount equal to the compensation (as 
                defined in section 219(f)) includible in the 
                individual's gross income for such taxable year.
            ``(2) Proration of limitation if part-year eligibility.--In 
        the case of an individual who is an eligible individual only 
        for a portion (but not all) of the calendar year ending with or 
        within the taxable year, the limitation under this subsection 
        for such taxable year shall be an amount which bears the same 
        ratio to such limitation (determined without regard to this 
        paragraph) as such portion bears to the entire calendar year.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Qualified asset account.--The term `qualified asset 
        account' means a trust created or organized in the United 
        States exclusively for the purpose of paying the qualified 
        expenses of the account beneficiary, but only if the written 
        governing instrument creating the trust meets the following 
        requirements:
                    ``(A) No contribution will be accepted unless it is 
                in cash, and contributions will not be accepted during 
                any calendar year in excess of $2,000.
                    ``(B) The trustee is a bank (as defined in section 
                408(n)) or another person who demonstrates to the 
                satisfaction of the Secretary that the manner in which 
                such person will administer the trust will be 
                consistent with the requirements of this section.
                    ``(C) No part of the trust assets will be invested 
                in life insurance contracts.
                    ``(D) The assets of the trust will not be 
                commingled with other property except in a common trust 
                fund or common investment fund.
            ``(2) Eligible individual.--The term `eligible individual' 
        means any individual if any member of such individual's family 
        is receiving aid under a State plan approved under part A of 
        title IV of the Social Security Act.
            ``(3) Qualified expenses.--The term `qualified expenses' 
        means, with respect to the account beneficiary, the amount paid 
        by such beneficiary for--
                    ``(A) the education of any member of such 
                beneficiary's family,
                    ``(B) training for employment of any such member,
                    ``(C) improving the job skills of any such member,
                    ``(D) starting a business by any such member,
                    ``(E) purchasing a principal residence for any such 
                member, and
                    ``(F) moving expenses for any such member in moving 
                to a new principal residence.
            ``(4) Qualified asset account contributions.--The term 
        `qualified asset account contributions' means any amount paid 
        in cash for the taxable year by or on behalf of an individual 
        to a qualified asset account for such individual's benefit.
            ``(5) Account beneficiary.--The term `account beneficiary' 
        means the individual for whose benefit the qualified asset 
        account is established.
    ``(d) Other Definitions and Special Rules.--
            ``(1) Time when contributions deemed made.--A contribution 
        shall be deemed to be made on the last day of the preceding 
        taxable year if the contribution is made on account of such 
        taxable year and is made not later than the time prescribed by 
        law for filing the return for such taxable year (not including 
        extensions thereof).
            ``(2) Married individuals.--The maximum credit under 
        subsection (b) shall be computed separately for each 
        individual.
            ``(3) Employer payments.--For purposes of this title, any 
        amount paid by an employer to a qualified asset account shall 
        be treated as a payment of compensation to the employee (other 
        than a self-employed individual who is an employee within the 
        meaning of section 401(c)(1)) includible in his gross income 
        for the taxable year for which the amount was contributed, 
        whether or not a credit for such payment is allowable under 
        this section to the employee.
    ``(e) Tax Treatment of Distributions.--
            ``(1) In general.--Any amount paid or distributed out of a 
        qualified asset account shall be included in the gross income 
        of the account beneficiary unless such amount is used 
        exclusively to pay the qualified expenses of such beneficiary.
            ``(2) Excess contributions returned before due date of 
        return.--Paragraph (1) shall not apply to the distribution of 
        any contribution paid during a taxable year to a qualified 
        asset account to the extent that such contribution exceeds the 
        amount excludable under subsection (a) if--
                    ``(A) such distribution is received by the 
                individual on or before the last day prescribed by law 
                (including extensions of time) for filing such 
                individual's return for such taxable year, and
                    ``(B) such distribution is accompanied by the 
                amount of net income attributable to such excess 
                contribution.
        Any net income described in subparagraph (B) shall be included 
        in the gross income of the individual for the taxable year in 
        which it is received.
            ``(3) Penalty for distributions not used for qualified 
        expenses.--
                    ``(A) In general.--The tax imposed by this chapter 
                for any taxable year in which there is a payment or 
                distribution from a qualified asset account which is 
                not used to pay the qualified expenses of the account 
                beneficiary shall be increased by 10 percent of the 
                amount of such payment or distribution which is 
                includible in gross income under paragraph (1).
                    ``(B) Disability or death cases.--Subparagraph (A) 
                shall not apply if the payment or distribution is made 
                after the account beneficiary becomes disabled within 
                the meaning of section 72(m)(7) or dies.
    ``(f) Tax Treatment of Accounts.--
            ``(1) In general.--A qualified asset account is exempt from 
        taxation under this subtitle, unless such account has ceased to 
        be a qualified asset account by reason of paragraph (2) or (3). 
        Notwithstanding the preceding sentence, any such account is 
        subject to the taxes imposed by section 511 (relating to 
        imposition of tax on unrelated business income of charitable, 
        etc., organizations).
            ``(2) Account terminates if individual engages in 
        prohibited transaction.--
                    ``(A) In general.--If, during any taxable year of 
                the account beneficiary engages in any transaction 
                prohibited by section 4975 with respect to the account, 
                the account ceases to be a qualified asset account as 
                of the first day of that taxable year.
                    ``(B) Account treated as distributing all its 
                assets.--In any case in which any account ceases to be 
                a qualified asset account by reason of subparagraph (A) 
                on the first day of any taxable year, paragraph (1) of 
                subsection (e) shall be applied as if there were a 
                distribution on such first day in an amount equal to 
                the fair market value (on such first day) of all assets 
                in the account (on such first day) and no portion of 
                such distribution were used to pay qualified expenses.
            ``(3) Effect of pledging account as security.--If, during 
        any taxable year, the account beneficiary uses the account or 
        any portion thereof as security for a loan, the portion so used 
        is treated as distributed and not used to pay qualified 
        expenses.
    ``(g) Custodial Accounts.--For purposes of this section, a 
custodial account shall be treated as a trust if--
            ``(1) the assets of such account are held by a bank (as 
        defined in section 408(n)) or another person who demonstrates 
        to the satisfaction of the Secretary that the manner in which 
        he will administer the account will be consistent with the 
        requirements of this section, and
            ``(2) the custodial account would, except for the fact that 
        it is not a trust, constitute a qualified asset account 
        described in subsection (c).
For purposes of this title, in the case of a custodial account treated 
as a trust by reason of the preceding sentence, the custodian of such 
account shall be treated as the trustee thereof.
    ``(h) Reports.--The trustee of a qualified asset account shall make 
such reports regarding such account to the Secretary and to the account 
beneficiary with respect to contributions, distributions, and such 
other matters as the Secretary may require under regulations. The 
reports required by this subsection shall be filed at such time and in 
such manner and furnished to such individuals at such time and in such 
manner as may be required by those regulations.''
    (b) Tax on Excess Contributions.--Section 4973 of such Code 
(relating to tax on excess contributions to individual retirement 
accounts, certain section 403(b) contracts, and certain individual 
retirement annuities) is amended--
            (1) by inserting ``qualified asset accounts,'' after 
        ``accounts,'' in the heading of such section,
            (2) by redesignating paragraph (2) of subsection (a) as 
        paragraph (3) and by inserting after paragraph (1) the 
        following:
            ``(2) a qualified asset account (within the meaning of 
        section 35(c)),'',
            (3) by striking ``or'' at the end of paragraph (1) of 
        subsection (a), and
            (4) by adding at the end thereof the following new 
        subsection:
    ``(d) Excess Contributions to Qualified Asset Accounts.--For 
purposes of this section, in the case of a qualified asset account 
(within the meaning of section 35(c)), the term `excess contributions' 
means the amount by which the amount contributed for the taxable year 
to the account exceeds the amount which may be taken into account in 
determining the credit under section 35 for such taxable year. For 
purposes of this subsection, any contribution which is distributed out 
of the qualified asset account in a distribution to which section 
35(e)(2) applies shall be treated as an amount not contributed.''
    (c) Tax on Prohibited Transactions.--Section 4975 of such Code 
(relating to prohibited transactions) is amended--
            (1) by adding at the end of subsection (c) the following 
        new paragraph:
            ``(4) Special rule for qualified asset accounts.--An 
        individual for whose benefit a qualified asset account (within 
        the meaning of section 35(c)) is established shall be exempt 
        from the tax imposed by this section with respect to any 
        transaction concerning such account (which would otherwise be 
        taxable under this section) if, with respect to such 
        transaction, the account ceases to be a qualified asset account 
        by reason of the application of section 35(f)(2)(A) to such 
        account.'', and
            (2) by inserting ``or a qualified asset account described 
        in section 35(c)'' in subsection (e)(1) after ``described in 
        section 408(a)''.
    (d) Failure to Provide Reports on Qualified Asset Accounts.--
Section 6693 of such Code (relating to failure to provide reports on 
individual retirement account or annuities) is amended--
            (1) by inserting ``or on qualified asset accounts'' after 
        ``annuities'' in the heading of such section, and
            (2) by adding at the end of subsection (a) the following: 
        ``The person required by section 35(h) to file a report 
        regarding a qualified asset account at the time and in the 
        manner required by such section shall pay a penalty of $50 for 
        each failure unless it is shown that such failure is due to 
        reasonable cause.''
    (e) Clerical Amendments.--
            (1) The table of sections for subpart C of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the item relating to section 35 and inserting the following:

                              ``Sec. 35. Qualified asset account 
                                        contributions.
                              ``Sec. 36. Overpayments of tax.''
            (2) The table of sections for chapter 43 of such Code is 
        amended by striking the item relating to section 4973 and 
        inserting the following:

                              ``Sec. 4973. Tax on excess contributions 
                                        to individual retirement 
                                        accounts, qualified asset 
                                        accounts, certain 403(b) 
                                        contracts, and certain 
                                        individual retirement 
                                        annuities.''
            (3) The table of sections for subchapter B of chapter 68 of 
        such Code is amended by inserting ``or on qualified asset 
        accounts'' after ``annuities'' in the item relating to section 
        6693.
    (f) Effective Date.--The amendments made by this section shall 
apply to contributions made after December 31, 1994, in taxable years 
ending after such date.

SEC. 4. STATE OPTION TO INCREASE AFDC INCOME DISREGARD FOR CERTAIN 
              STEPPARENTS.

    Section 402(a)(31) of the Social Security Act (42 U.S.C. 
602(a)(31)) is amended--
            (1) by striking ``(A)'' and all that follows through 
        ``(C)'' and inserting ``(A) the first $120 of the total of the 
        stepparent's earned income for the month, plus \1/3\ of the 
        remainder of such earned income, (B)''; and
            (2) by striking ``(D)'' and inserting ``(C)''.

SEC. 5. ELIMINATION OF RULES THAT TREAT FAMILIES DIFFERENTLY BASED ON 
              NUMBER OF PARENTS IN THE HOME.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)) is amended by striking paragraph (41).
    (b) Conforming Amendments.--
            (1) Section 402(a)(19)(B)(i)(II) of such Act (42 U.S.C. 
        602(a)(19)(B)(i)(II)) is amended by striking ``(and'' and all 
        that follows through ``407(b)(2)(B)(i))''.
            (2) Section 402(a)(19)(D) of such Act (42 U.S.C. 
        602(a)(19)(D)) is amended by striking ``eligible'' and all that 
        follows through ``earner'' and inserting ``in which both 
        parents are living at home''.
            (3) Section 402(a)(19)(G)(i) of such Act (42 U.S.C. 
        602(a)(19)(G)(i)) is amended--
                    (A) in subclause (I), by striking ``(whether or not 
                section 407 applies)''; and
                    (B) in subclause (II), by striking ``which is 
                eligible for aid to families with dependent children by 
                reason of section 407'' and inserting ``in which both 
                parents are living at home''.
            (4) Section 402(a)(38)(B) of such Act (42 U.S.C. 
        602(a)(38)(B)) is amended by striking ``or in section 407(a)''.
            (5) Section 402(a) of such Act (42 U.S.C. 602(a)) is 
        amended by striking paragraph (42).
            (6) Section 403(l)(4)(A)(i) of such Act (42 U.S.C. 
        603(l)(4)(A)(i)) is amended by striking ``family eligible'' and 
        all that follows through ``earner'' and inserting ``2-parent 
        family''.
            (7) Section 406(a)(1) of such Act (42 U.S.C. 606(a)(1)) is 
        amended by striking ``who has been deprived'' and all that 
        follows through ``incapacity of a parent''.
            (8) Section 406(b)(1) of such Act (42 U.S.C. 606(b)(1)) is 
        amended by striking ``and if such relative'' and all that 
        follows through ``section 407''.
            (9) Section 407 of such Act (42 U.S.C. 607) is hereby 
        repealed.
            (10) Section 472(a) of such Act (42 U.S.C. 672(a)) is 
        amended by striking ``or of section 407''.
            (11) Section 473(a)(2)(A)(i) of such Act (42 U.S.C. 
        672(a)(2)(A)(i)) is amended by striking ``or section 407''.
            (12) Section 1115(b) of such Act (42 U.S.C. 1315(b)) is 
        amended by striking paragraph (5).
            (13) Section 1115 of such Act (42 U.S.C. 1315) is amended 
        by striking subsection (d).
            (14) Section 1902(a)(10)(A)(i) of such Act (42 U.S.C. 
        1396a(a)(10)(A)(i)) is amended by striking subclause (V) and by 
        redesignating subclauses (VI) and (VII) as subclauses (V) and 
        (VI), respectively.
            (15) Section 1905 of such Act (42 U.S.C. 1396d) is amended 
        by striking subsection (m).
            (16) Section 1905(n)(1) of such Act (42 U.S.C. 1396d(n)(1)) 
        is amended--
                    (A) in subparagraph (A)--
                            (i) by striking ``(or'' and all that 
                        follows through ``407)''; and
                            (ii) by adding ``or'' at the end; and
                    (B) by striking subparagraph (B).
            (17) Section 204(b)(2) of the Family Support Act of 1988 
        (42 U.S.C. 681 note) is amended by striking the semicolon and 
        all that follows through ``1998''.

SEC. 6. EXTENSION OF TRANSITIONAL CHILD CARE BENEFITS FOR EMPLOYED AFDC 
              RECIPIENTS.

    Section 402(g)(1)(A)(iii) of the Social Security Act (42 U.S.C. 
602(g)(1)(A)(iii)) is amended by inserting ``(or, if and for so long as 
the caretaker relative of the family is employed, 24 months)'' after 
``12 months''.

SEC. 7. DENIAL OF AFDC FOR APPLICANTS WHO HAVE ABANDONED A CHILD.

    Section 402(a) of the Social Security Act (42 U.S.C. 602(a)) is 
amended--
            (1) by striking ``and'' at the end of paragraph (44);
            (2) by striking the period at the end of paragraph (45) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (45) the following:
            ``(46) notwithstanding any other provision of this part, 
        provide that an applicant for aid under the State plan shall 
        not be eligible for such aid if a court has found that the 
        applicant has abandoned a child.''.

SEC. 8. STATE OPTION TO DENY AFDC FOR ADDITIONAL CHILDREN.

    Section 402(a) of the Social Security Act (42 U.S.C. 602(a)), as 
amended by section 7 of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (45);
            (2) by striking the period at the end of paragraph (46) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (46) the following:
            ``(47) at the option of the State, provide that--
                    ``(A) aid under the State plan shall not be payable 
                to a family with respect to a child born to a family 
                member--
                            ``(i) while a recipient of aid under the 
                        State plan; or
                            ``(ii) who received aid under any State 
                        plan approved under this part at any time 
                        during the 10-month period that ends with the 
                        birth of the child; and
                    ``(B) a child with respect to whom aid is not 
                payable under the State plan under this part solely by 
                reason of subparagraph (A) shall be considered to be 
                receiving such aid for purposes of eligibility for 
                medical assistance under the State plan approved under 
                title XIX.''.

SEC. 9. STATE OPTION TO DENY AFDC BENEFITS TO PARENTS WHOSE CHILDREN 
              HAVE NOT RECEIVED REQUIRED IMMUNIZATIONS.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)), as amended by sections 7 and 8 of this Act, is 
amended--
            (1) by striking ``and'' at the end of paragraph (47);
            (2) by striking the period at the end of paragraph (48) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (48) the following:
            ``(49) at the option of the State, provide that--
                    ``(A) the State will deduct and withhold from the 
                amount of aid otherwise payable under the State plan to 
                a family that is not in compliance with this paragraph 
                an amount equal to--
                            ``(i) the amount of such aid otherwise 
                        payable to the family; minus
                            ``(ii) the amount of such aid that would be 
                        payable to the family if, in making the 
                        determination under paragraph (7) with respect 
                        to a family, the needs of the caretaker 
                        relative (and the spouse of such relative, if 
                        section 407 applies) were not taken into 
                        account;
                    ``(B) the State will apply subparagraph (A) to a 
                noncompliant family for each month for which such 
                noncompliance continues;
                    ``(C) the State will place into escrow all amounts 
                deducted and withheld from a family pursuant to 
                subparagraph (A);
                    ``(D) the State will pay in a lump sum to a family 
                eligible for aid under the State plan that has ceased 
                to be a noncompliant family an amount equal to--
                            ``(i) the total amount deducted and 
                        withheld from the family pursuant to 
                        subparagraph (A); divided by
                            ``(ii) the number of months for which 
                        amounts have been so withheld and deducted;
                    ``(E) the State shall consider a family to be not 
                in compliance with this paragraph if the family 
                includes a dependent child who has not attained 6 years 
                of age, and the State agency has not received from 1 or 
                more physicians written verification (on a form 
                prescribed by the State) that the child has been 
                immunized in accordance with recommendations issued by 
                the Surgeon General of the Public Health Service, 
                unless the child has not been so immunized for good 
                cause (as determined by the State in accordance with 
                regulations prescribed by the Secretary), including--
                            ``(i) medical contraindication, as 
                        evidenced by written notice from a physician 
                        (on a form prescribed by the State);
                            ``(ii) an excessive distance between the 
                        residence of the child and the nearest location 
                        at which the child could be so immunized;
                            ``(iii) the lack of reasonable access to 
                        transportation to any location at which the 
                        child could be so immunized;
                            ``(iv) an excessive waiting period at any 
                        such location before the child could be so 
                        immunized;
                            ``(v) religious objection to the child 
                        being so immunized; and
                            ``(vi) an illness of a member of the family 
                        that has prevented the child from being 
                        accompanied by a responsible adult to any such 
                        location; and
                    ``(F) the State will conduct appropriate education 
                and outreach activities designed to--
                            ``(i) increase public awareness of the 
                        importance of preventive health care and 
                        immunizations for preschool children; and
                            ``(ii) inform the public about--
                                    ``(I) the availability of 
                                preventive health care and immunization 
                                services for preschool children;
                                    ``(II) any transportation, child 
                                care, or other support services that 
                                may be available to assist parents in 
                                obtaining such services for their 
                                children; and
                                    ``(III) the clinics at which any 
                                child may receive immunizations free or 
                                at a reduced charge.''.
    (b) Issuance of Immunization Recommendations by the Surgeon General 
of the Public Health Service.--After taking into consideration the then 
most recent report of the Committee on Infectious Diseases of the 
American Academy of Pediatrics, the Surgeon General of the Public 
Health Service shall issue, and revise from time to time, 
recommendations for the immunization of children under 6 years of age. 
With respect to each recommended immunization, such recommendation 
shall include--
            (1) contraindications (if any) that should be identified to 
        exempt a child from receiving such immunization, and
            (2) remedial action that may be taken to minimize the 
        adverse effect of failure to administer such immunization to a 
        child at the recommended age.

SEC. 10. STATE OPTION TO DISREGARD INCOME AND RESOURCES DESIGNATED FOR 
              EDUCATION, TRAINING, EMPLOYABILITY, OR SELF-EMPLOYMENT.

    (a) Resource Disregard.--Section 402(a)(7)(B) of the Social 
Security Act (42 U.S.C. 602(a)(7)(B)) is amended--
            (1) by striking ``or'' at the end of clause (iii); and
            (2) by inserting ``, or (v) at the option of the State, in 
        the case of the family, not more than $9,000 in 1 qualified 
        asset account (as defined in section 406(i)) of the family'' 
        before the semicolon.
    (b) Disregard of Income From Qualified Asset Accounts.--Section 
402(a)(8)(A) of such Act (42 U.S.C. 602(a)(8)(A)) is amended--
            (1) by striking ``and'' at the end of clause (vii); and
            (2) by inserting after clause (viii) the following:
                            ``(ix) at the option of the State, may 
                        disregard--
                                    ``(I) any interest or income earned 
                                on 1 qualified asset account (as 
                                defined in section 406(i)), if not more 
                                than $2,000 has been deposited in the 
                                account during the immediately 
                                preceding 12-month period, but only to 
                                the extent that the total amount in the 
                                account, after the payment of such 
                                interest or income, does not exceed 
                                $9,000; and
                                    ``(II) any qualified distribution 
                                (as defined in section 406(i)(2)) from 
                                a qualified asset account (as defined 
                                in section 406(i)(1)); and''.
    (c) Nonrecurring Lump Sum Exempt From Lump Sum Rule.--Section 
402(a)(17) of such Act (42 U.S.C. 602(a)(17)) is amended by adding at 
the end the following: ``; and, at the option of the State, that this 
paragraph shall not apply to earned or unearned income received in a 
month on a nonrecurring basis to the extent that such income is 
deposited in a qualified asset account (as defined in section 406(i)) 
in which not more than $2,000 has been deposited during the immediately 
preceding 12-month period and the total amounts in which, after such 
placement, does not exceed $9,000;''.
    (d) Definitions.--Section 406 of such Act (42 U.S.C. 606) is 
amended by adding at the end the following:
    ``(i)(1) The term `qualified asset account' means an account 
established at a financial institution by a recipient of aid to 
families with dependent children, in which not more than $2,000 has 
been deposited during any period of 12 consecutive months, for the 
purpose of saving money to--
            ``(A) enable a member of the family of the recipient to 
        attend an education or training program;
            ``(B) enable a member of the family to improve his or her 
        employability (including self-employment), including through 
        the purchase of an automobile;
            ``(C) purchase a home for the family;
            ``(D) change the family residence; or
            ``(E) operate or establish a commercial enterprise which 
        has 5 or fewer employees, 1 or more of whom owns or would own 
        the enterprise.
    ``(2) The term `qualified distribution' means a distribution from a 
qualified asset account for expenses directly related to 1 or more of 
the purposes described in paragraph (1).''.

SEC. 11. STATE OPTION TO INCREASE LIMITATION ON DISREGARD OF EQUITY IN 
              AN AUTOMOBILE.

    Section 402(a)(7)(B)(i) of the Social Security Act (42 U.S.C. 
602(a)(7)(B)(i)) is amended by inserting ``(or, at the option of the 
State, $3,000)'' before ``, (ii)''.

SEC. 12. TREATMENT OF STUDENT EARNINGS UNDER THE AFDC PROGRAM.

    (a) Exemption From Resources of Exempt Earnings of a Child.--
Section 402(a)(7)(B) of the Social Security Act (42 U.S.C. 
602(a)(7)(B)), as amended by section 10(a) of this Act, is amended--
            (1) by striking ``or'' at the end of clause (iv); and
            (2) by inserting ``, or (vi) the earned income of any child 
        to the extent disregarded under paragraph (8)'' before the 
        semicolon.
    (b) Exempt Earnings of a Child To Be Disregarded in Determining 
Whether Family Income Exceeds Need Standard.--Section 402(a)(18) of 
such Act (42 U.S.C. 602(a)(18)) is amended by striking ``paragraph 
(8)(A)(v) or 8(A)(viii)'' and inserting ``clause (i), (v), or (viii) of 
paragraph (8)(A)''.
    (c) Disregard of Earnings of Students and Income of Dependent Child 
From a JTPA Program.--Section 402(a)(8)(A) of such Act (42 U.S.C. 
602(a)(8)(A)) is amended--
            (1) in clause (i), by inserting ``(including a child 
        (whether or not married) who has not attained 20 years of 
        age)'' after ``dependent child''; and
            (2) in clause (v)--
                    (A) by inserting ``that portion of'' before ``the 
                income'';
                    (B) by inserting ``(including any individual 
                (whether or not married) who has not attained 20 years 
                of age)'' after ``dependent child''; and
                    (C) by striking ``in such amounts, and for such 
                period of time (not to exceed six months with respect 
                to earned income)'' and inserting ``to the extent not 
                exceeding the income official poverty line (as defined 
                by the Office of Management and Budget, and revised 
                annually in accordance with section 673(2) of the 
                Omnibus Budget Reconciliation Act of 1981) applicable 
                to the family, for such period of time''.

SEC. 13. EFFECTIVE DATE.

    Except as provided in section 3(f), the amendments made by this Act 
shall apply to calendar quarters beginning on or after January 1, 1995.

                                 <all>

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